• Like a bad penny, debt always turns up…

    unless we change how we interact with money, of course!

    The Bad Penny is dedicated to two pursuits: getting out of debt and staying out of debt! It recognizes that frugality and caring for our planet go hand in hand, and that our unsatiated need for stuff is hurting us in so many ways.

    Easier said than done!


    I am not a finance professional. I write about the world as I know it, and my advice may not be the best course of action for you! Please seek qualified advice for your particular situation.

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A Little Savings Can Go a Long Way

My son has discovered money.

Now, he’s only two, and he hasn’t figured out money will allow him to take all those toys home from the toy store. But he does know two things:

1. Coins can be put in a video game or crane machine for a bouncy ball.

2. Coins can be put in a bank (though I think the pleasure lies solely in the actual act of putting the coins in.)

In fact, we just went to Cici’s Pizza last night, where the all-you-can-eat salad and pizza buffet is only $5 a person. In the back, there’s a game room, and it’s been a tradition for us to go and spend a quarter to get a small bouncy ball. After this, my son is usually just as happy “driving” the race car simulation game as anything, and we just let him play on the introduction without putting money in!

But I’ve noticed that when we get home, my son really likes to put his coins in his bank. Once his coins are all deposited, he begs us for more. So I’ve taken to saving my change to give to him.

And while saving change seems like a small thing to do, it’s actually very effective, especially when you are saving for something! I actually have my own change bank, which I emptied out right before we moved. After just a few months, I had $40 when I emptied it!

This was effective, but it was so easy to raid my piggy bank when I knew I’d want a Pepsi from the church vending machine or when we were taking the toll highway. I didn’t have a goal to save for, so the change was available for every whim. I’m sure I would have saved more if I hadn’t been playing the Viking!

Giving the coins to my son changed that. It’s absolutely gratifying and terribly fun to see how excited he gets putting a few pennies and nickels into his bank. And I feel like when it’s in his bank, it’s his money, so I don’t dare take any!

I don’t know what we’ll do with the money – maybe we’ll save it up for something big he’ll need in the future, but because it’s his it will stay there – except for when we go to the bank and deposit it into his savings account.

I’m still using my coin bank, but I’m also still raiding it. What would motivate you not to spend the money? Where could you put your extra coins when the day is done so they actually add up? If you don’t have a child, would a picture of what you are saving for motivate you to keep your hands off? What about a bank you’d have to break to open?


Saving for the Kids

My two-year-old son’s savings account has nearly $700 in it.  I had no idea it had climbed that high, but I just got a statement from the bank.  We started the savings account shortly after he was born, putting $25 into his account each month through a direct debit from our checking account.  (This is our checking account in North Carolina at the Credit Union which has our emergency savings fund and into which my father-in-law deposits his half of the cell phone bill.)

It has never occurred to me to use that money for our debt.  The money is off-limits to us, because it belongs to my son.  It’s important that we continue saving for his future, just as my parents did for me.  When I married, my mom gave me some savings bonds to cash that she took out for me when I was a baby.  It wasn’t enough to buy a semester’s worth of books, but  it was enough to buy my husband a handsome gold band.  (And my parents helped a lot with my college expenses, too.)

I want to be able to do that for my children.  I want them to have some money to help get them started – whether they use that money for college, for job expenses, or some other item.

I hope to teach my children the value of investing.  I hope that my husband’s and my guidance will teach them to use that money wisely – for something that will add to their value – an education or an non-depreciating asset like a house.  I’ve been reading a lot of blogs in the past few days that talk about teaching kids about money, and I think they are well worth reading.  In fact, several bloggers have been very age-specific!

Madison at MyDollarPlan talks about teaching infants and toddlers about money.  We’ve got to get a will together, and she mentions investing in a 529 (which we have, but need to contribute more) and not buying life insurance for the kids.

If you have preschoolers, check out PaidTwice’s article on Teaching Preschoolers About Money.  She’s got some really good points.  A personal favorite of mine was the article she wrote about how she taught her three year old the value of two dollars – I was amazed that her son was able to forego immediate gratification to get what he wanted more!

Lynnae at Being Frugal talks about Personal Finance for School-Aged Children (specifically ages six to nine and nine to twelve.)  While I don’t have kids that age, I’ve worked with them as their teacher before, and I think Lynnae’s ideas are perfectly suited for each age group and what they understand well.

Check out these blogs if you haven’t heard of them before – I always enjoy reading them.  Their comfortable style of writing and good grasp of the issues really make them useful in a journal to financial freedom!